Avro India Downgraded to 'Sell' by MarketsMOJO, Underperformance in Market Evident

Avro India, a microcap company in the plastic products industry, has recently been downgraded to a 'Sell' by MarketsMOJO on August 13, 2024. This decision was based on the company's flat results in March 2024, with a PBT (Profit Before Tax) of -0.46 crore and a high non-operating income of 136.80% of PBT.
Furthermore, Avro India's ROCE (Return on Capital Employed) of 18.8 indicates an expensive valuation with a 3.9 Enterprise value to Capital Employed. The stock is currently trading at a discount compared to its average historical valuations. Despite generating a return of 13.63% in the past year, the company's profits have fallen by -2.9%. This underperformance in the market is evident as the stock has generated a lower return compared to the BSE 500 index, which has seen a return of 34.08% in the same period.

However, there are some positive factors to consider. Avro India has a high management efficiency with a ROCE of 19.74%. Additionally, the company has a low Debt to EBITDA ratio of 1.29 times, indicating a strong ability to service debt.

From a technical standpoint, the stock is currently in a mildly bullish range. The technical trend has improved from sideways on August 13, 2024, and both the Bollinger Band and OBV (On-Balance Volume) technical factors are also bullish.

It is worth noting that the majority shareholders of Avro India are promoters, which could potentially impact the company's decision-making and direction. Overall, with the recent downgrade to 'Sell' and the underperformance in the market, investors may want to carefully consider their position in Avro India.